(MENAFN - Jordan Times) Landlords in some parts in the old city centre of Amman say they are millionaires in the books, but in reality, the rent revenues they generate are only "peanuts".
Meanwhile, their tenants cry foul as, they claim, the new Landlords and Tenants Law is adding to their financial burdens in years-long controversy over how the law should look like, even after it went into effect this year.
Mazen Hadid, president of the Jordanian Landlords and Land Owners Society, claimed that there are stores rented in downtown Amman for around JD1,000 a year, while the taxes that owners have to pay to the municipality for the stores exceed JD4,000 per year.
"It is a fact some landlords lose money because of the properties they own," he told The Jordan Times Tuesday.
Describing the 2011 Landlords and Tenants Law, which went into effect at the beginning of this year, as an answer to their decades-long woes, Hadid insisted that owners are unable to cope with the rising living costs and taxes due to the "cheap" old rents.
"We are viewed as millionaires because of the properties we own, but the truth is that tenants are the real beneficiaries of the buildings," he said.
However, merchants claim that the new law will pile more financial burdens on them.
Traders plan to hold a nationwide strike next Sunday to protest the new law and the hikes in electricity rates. The government announced on Monday that it will revise the electricity tariffs.
Hadid criticised traders' outrage over the law, calling on them to judge the legislation once it is practically implemented, adding that merchants are against Article 5 of the law, which requires long-standing tenants and their landlords to negotiate new rents or, if they cannot agree on a new rate, have it determined by court.
Since the law went into effect early this year, around 5,000 cases have been referred to the judiciary, he noted, indicating that the majority of lessees have reached agreements with owners regarding new rents, but the problem remains in downtown Amman as merchants still want to pay relatively low rents.
"Owners of stores in downtown Amman have become poor because of such low and unfair rents," Hadid said, pointing out that there are some shops that have been rented since the 1950s and 1960s.
Mohammad Kaabneh, head of a society to defend the rights of landlords, agreed with Hadid, saying that in some cases, landlords were not even allowed by tenants to renovate or build supplements to their properties.
He added that landlords are not in favour of ordering tenants to vacate the rented buildings but they seek to receive fair rents.
"We do not want them to vacate the properties; we want to make reasonable revenues from our investments," Kaabneh noted.
Commenting on the planned strike by traders, Kaabneh said: "Unfortunately, traders want to take advantage of the current conditions in the country to exert more pressure on the government," he stated, referring to the new atmosphere of freedom that saw thousands of all kinds of protests since early last year.
Awni Loqman, owner of the popular Balabseh Souk in downtown Amman, said he supports a gradual increase of rents in a bid to solve the issue with tenants.
He told The Jordan Times that the annual rents of shops in the commercial complex, built around a century ago, is around JD800, while the real value of the rentals should be JD8,000 a year.
Some tenants own commercial shops in other areas, while they insist on occupying stores in the complex, the 78-year-old landlord said.
Fouad Afghani, an antiques trader, who has been renting a shop on King Talal Street since 1973, said that he will join the strike, planned by the Jordan Chamber of Commerce (JCC), although he acknowledged the "legitimate" demands of landlords.
"I will join the strike because I don't want to be labelled as a traitor," he said, indicating that he currently pays a rent of JD2,200 per year for the shop, while the owner is asking for JD7,000 annually.
Afghani also suggested an annual and gradual 5 per cent increase of the rent, so tenants do not feel the complete rise and landlords can reach the rental value they ask for within a few years.
Bassem Sabha, a lingerie trader in downtown Amman, also supported the proposal of the gradual increase of the rent.
Sabha, who has been renting a large store in Souk Mango since 1949, has reached an agreement with the owner to pay JD4,400 as an annual rent instead of the old rental fees of JD4,000 per year.
Tariq Tabbaa, member of the Amman Chamber of Commerce, said traders are expected to meet Wednesday to discuss the strike, particularly after the government announced it would revise the electricity tariffs.
The Jordan Times tried to reach JCC President Nael Kabariti but he was not available.